UK commercial property falls persist

British commercial real estate values fell for the 15th consecutive month in January, led by a decline in retail, Investment Property Databank said.

The average value of stores, offices and warehouses declined 0.2 per cent from December, the London-based IPD said. Total return, which combines changes in real estate values and rental income, was 0.4 per cent in January.

“There are some encouraging signs starting to emerge, with pockets of improvement around the UK," Phil Tily, an IPD managing director, said.

“With the pricing so keen for central London assets there may be more movement among investors to seek better value in the regions."

Britain faced a muted economic recovery and a further bout of inflation, Bank of England governor
Mervyn King
said. The Confederation of British Industry, Britain’s biggest business lobby group, also lowered its 2013 economic growth projection to 1 per cent, from 1.4 per cent.

The value of office buildings in the City of London financial district fell for the first time since July. Capital growth slowed in London’s West End office and retail markets, IPD said. Retail values overall declined by 0.3 per cent.